Myers Industries Inc.’s third quarter earnings fell from a year ago as revenue rose, the Akron plastics and rubber manufacturer and tool distributor reported Thursday.
Sales rose to $197.3 million, up 3.7 percent from $190.3 million a year ago. Net income was $5.8 million or 17 cents per share, down 19.4 percent from $7.2 million or 21 cents per share for the third quarter a year ago.
When adjusted for special items, Myers earned 20 cents per share for the quarter compared to 14 cents a share a year ago, the company reported.
The company’s president and chief executive officer, John Orr, told industry analysts that Myers is looking at making significant changes to its Lawn & Garden segment, which includes part of its Akro-Mils brand and makes such things as planters, trays and plant containers for nurseries and where financial performance has been lagging.
The segment broke even on net sales of $45.3 million for the quarter; it lost $1.4 million on sales of $45.8 million a year ago. Orr did not offer specifics on what actions the company will take.
Shares closed down 34 cents Thursday to $15.08. Shares are up 22 percent since Jan. 1 and are up 26 percent from a year ago.
“Despite current market challenges, we are encouraged by our financial performance for the third quarter of 2012,” Orr said in a statement.
“Our income before taxes improved 43.1 percent over last year’s third quarter,” he said.
Income rose because of strong performance in its Material Handling segment as well as improved results in Lawn & Garden compared to last year, he said.
“We expect that both our fourth quarter and full year performance will show improved results compared to last year,” Orr said.
Myers said that it expects the fourth quarter will be boosted by a shift of orders for its Material Handling unit from the third quarter to the fourth. The Lawn & Garden segment is also expected to improve.
Those gains may be offset in part by a decline in the replacement tire industry and other automotive-related business, Myers said.
Orr noted Myers’ announcement on Oct. 2 that it bought Jamco Products Inc., which makes heavy-duty industrial steel carts and safety cabinets, and will incorporate it into its Material Handling business. Terms were not disclosed.
Orr said that Myers executives are focusing on areas where the company has a competitive advantage and good growth potential while also addressing underperforming areas. He told analysts that the company has been doing a strategic review of its Lawn & Garden segment.
“We will continue to take action to improve the business as we did this quarter and have done the last several quarters,” Orr said. “However, we don’t think these actions are generating value fast enough to meet both our expectations and those of our shareholders. After further review of the market, we believe that there is a range of alternatives to improve, restructure, exit or externally combine parts of the business and we are in the process of carefully looking at each of these options.”
Instead of exiting the entire business, there may be greater potential in addressing pieces of the business, Orr said.
Jim Mackinnon can be reached at 330-996-3544 or jmackinnon@thebeaconjournal.com.
